Failed Ebert firm’s debts top $123m

The amount failed construction company Ebert Construction owes unsecured creditors continues to soar but liquidators have hinted action may be in the wings for directors.

Ebert went into receivership in August last year. Initial losses were put at just over $24.5 million but by April this year the debt had blown out to over $119m and it now stands at more than $123.5m, according to the latest report from BDO liquidators Iain Shephard and Jessica Kellow. They said the liquidation process continued to pursue ‘‘numerous areas of investigation’’. They had formed a ‘‘preliminary view there might have been a breaches of directors’ duties and have put the directors on notice of a potential claim’’.

After the BNZ, which is owed just over $6m, Ebert’s second secured creditor is former managing director Kelvin Hale and another shareholder owed $3.5m.

BDO said it was waiting for a court date to hear its request for a ‘‘preferential effect to a related party creditor’’ to be set aside.

A notice of opposition had also been filed by the respondent.

BDO recently successfully held four directors of Mainzeal Construction to account, with the High Court ordering them to pay damages of $36m.

Keith Hardie, a director of one of Ebert’s many creditors, Accurate Concrete Cutting in Hamilton, said his company got off fairly lightly but some other creditors no longer existed. As a director himself, he felt Ebert’s directors should ‘‘maybe feel a little bit of the pain’’ the collapse had caused.

‘‘It is not really that fair on all the people who have gone broke that some of those guys are still trundling around in flash cars and still have a wealthy lifestyle and that.’’

Ebert was one of New Zealand’s largest construction companies and had been in business for 19 years when it collapsed on July 31 last year, leaving contractors locked out the next day.

The company had 100 staff and was actively working on 15 sites including the Indian High Commission in Wellington and the Union Green apartment complex in Auckland. But despite a projected turnover of $171m for 2019, and a flourishing business building processing plants, Ebert’s directors were worried the company was making too many losses in general construction.

They voluntarily put the company into receivership and later liquidation.

Unhappy creditors later wrested Ebert’s liquidation out of the hands of the directors’ chosen company and appointed BDO.

The latest report shows preferential creditors including staff are owed just over $1.019m. But staff remain out of pocket by $757,056, because the sums they are owed exceed the Companies Act’s preferential limit.